March 2, 2010Client Alert

Wisconsin Court of Appeals Clarifies Duty to Rehire Injured Employee Off Work Due to Work-Related Injury

The decision of the Wisconsin Court of Appeals, Electro-Connect, Inc. v. Labor and Industry Review Commission, 2009 AP 1022 (February 10, 2010), is a fairly remarkable decision dealing with a fairly mundane issue under the Wisconsin Worker’s Compensation Act. Corey Weed worked as a “lead worker or supervisor” for a company that performed electro-mechanical assembly. The company had three assembly areas, and Mr. Weed did some work, and sub-supervision, in one of the three areas. On October 18, 2005, Weed suffered an injury which (apparently) was compensable under the employer’s worker’s compensation insurance policy. The company refused to report the injury to its worker’s compensation carrier, and Mr. Weed reported the injury, himself.

On October 21, Mr. Weed’s doctor “took him completely off work.” On November 13, 2005, less than a month later, the employer filled Weed’s position. On November 23, 2005 (just 10 days later), Weed’s doctor released him to return to work with restrictions on “pushing, pulling or repetitive bending, and a 20 pound lifting and carrying limit.” The company received the new restrictions, but refused to rehire him. Weed filed a claim, alleging that the company had violated Wis. Stat. § 102.35(3), the Wisconsin “unreasonable refusal to rehire” statute.

Wis. Stat. § 102.35(3) is a “little disability discrimination” statute that exists within the Wisconsin Worker’s Compensation statute and predates state and federal disability discrimination laws. Basically, if an employee suffers a worker’s compensation compensable injury, the employer must return him/her to work. If the employer does not return the employee to work, the employer bears the burden of proving that it would not have been “reasonable” to return the employee to work. Predictably, litigation over § 102.35(3) cases focuses on the question: What is “reasonable”?

In this case, the Administrative Law Judge found that the company had no job available for Weed to perform at the time he was released to return to work. The Labor and Industry Review Commission (“LIRC”) reversed, finding that there was assembly work that Weed could perform within his restrictions. The company appealed to the Circuit Court, which reversed the LIRC; and the Court of Appeals (in the attached decision) agreed with the Circuit Court.

The Court of Appeals reasoned that employees at the company rotated between tasks. While there was assembly “work” to be performed, there was no dedicated “job” performing assembly work within Weed’s new restrictions. The Court of Appeals therefore reasoned that there was no open position into which the company could have placed Weed. The Court also rejected that part of the LIRC’s reasoning having to do with the company’s failure to report Weed’s injury to its worker’s compensation carrier. The LIRC held that this had bearing on whether their failure to hire Weed was “unreasonable.” The Court of Appeals disagreed, concluding that the fact the company failed to report Weed’s injury to its worker’s compensation carrier “has no bearing on whether suitable employment was actually available when Weed sought to be rehired.”

There are two remarkable things about the attached decision. First, LIRC generally is afforded substantial deference in judicial review of its decisions. Normally, courts grant LIRC’s decisions “great weight,” a standard of review under which the court must affirm LIRC if there is any evidence in the record that supports LIRC’s holding under the applicable law. Interestingly, the Court of Appeals decision does not mention (at all) what standard of review it applied to LIRC’s decision. Appellate decisions reviewing LIRC decisions usually begin with a recitation of the law regarding standard of review, and announce which standard the Court of Appeals is applying. Not so here. It is rare for an LIRC decision to be overturned. It is rarer, still, for this to happen without any discussion of the standard of review being applied.

The second remarkable fact is that the company replaced an employee just a few weeks after his injury, but was able to prevail on the argument that there was no suitable work available within his restrictions when he was released to return only 10 days later. The company pulled a fairly “quick trigger” in this case in filling a job. Apparently, the company is small, and everyone filled in and rotated through tasks. In fact, it appears that the owner of the company ended up performing some of Weed’s duties while he was off work. It is highly likely that the small workforce in this case was significant to the finding that the company acted “reasonably” in filling Weed’s job as quickly as it did.

While the decision by the Court of Appeals offers comfort that a business-reasonable decision here was lawful as well, employers should tread carefully. First, the employer lost this case at the Commission level, and had to go all the way to the Court of Appeals to “win.” Second, the decision provides a safe harbor only when employees suffer workplace injuries that do not qualify as “disabilities” for state or federal disability discrimination purposes. It is less likely that, if Weed’s injury qualified as a disability for Wisconsin Fair Employment Act or Americans with Disabilities Act purposes, the company could have prevailed in showing that it met its duty to accommodate Weed reasonably when it filled his position and terminated him just a few weeks after he was injured and without first engaging in the interactive process regarding disability accommodation.

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